1982 (6) TMI 17

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....nsation awarded by the court on September 29, 1956, is liable to levy of income-tax for the assessment year 1957-58 ?" The Tribunal did refer the same question. In R.C. No. 1 of 1978, the Department asked for two questions to be referred, on identical facts, namely: " 1. Whether, on the facts and in the circumstances of the case, the sum of Rs. 33,094, being the interest on compensation awarded by the court, is an assessable income under the Income-tax Act ? 2. Whether, on the facts and in the circumstances of the case, the sum of Rs. 33,094 is liable to assessment for the year 1957-58 ? The Tribunal, however, referred the following question : " Whether, on the facts and in the circumstances of the case, the sum Rs. 33,094....

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....appeal before this court and the claimants filed cross-objections. The High Court by its judgment dated November 1, 1963, confirmed the rate of compensation, but decreased the area of land acquired to Ac. 145-00. As stated above, according to the judgment of the civil court dated September, 29, 1956, interest was payable at 6% per annum. The ITO wanted to tax the entire amount of interest payable to the two assessees, by virtue of the judgment of the civil court, in the assessment year 1957-58, which was objected to by the assessees. (We may state that the amount of interest payable to each of the assessees in these two references is identical, namely, Rs. 33,094. as per the judgment of the civil court). The ITO overruled the objections ....

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.... however, told that the judgment of this court in Sankari Manickyamma's case is the subject-matter of appeal in the Supreme Court now. Be that as it may, the taxability of the amount can no longer be questioned by the assessee in view of the aforesaid decisions and we must, therefore, hold that the amount of interest received on compensation is taxable as income. The next question is, whether the said income is liable to be taxed in the assessment year 1957-58. On this question again the matter seems to be no longer res integra. It has been held by the Gujarat High Court in Topandas Kundanmal v. CIT [1978] 114 ITR 237 and Addl. CIT v. New Jehangir Vakil Mills Co. Ltd. [1979] 117 ITR 849 (Guj) and by the Calcutta High Court in CIT v. Hind....